Citigroup India, in a note released on Wednesday said the Reserve Bank measures announced last evening would help reduce the pressure on rupee.
Rohini Malkani, economist, Citigroup India said the RBI could become more active in the coming months.
She said given the volatile market situation, near term rupee weakness is likely to continue and could trade in the Rs 45-47 range. But over a longer term , ''we maintain our rupee appreciation view and expect the unit to trace back to Rs43-44 levels by March 09.'', she said.
Rupee which almost touched 47 mark on Tuesday recovered today to 46.34 levels.
According to Malkani, the key reasons for the 10 per cent depreciation in rupee in the past month were the strong dollar rally and acute dollar shortage in the local market coupled with the dis-continuation of the Special Market Operation Scheme (where RBI provided dollars to the oil companies in lieu of oil bonds).
The dollar shortage was a result of continued portfolio flows, offshore demand and demand from oil companies, she said while adding that exporters are now holding back from selling.
No comments:
Post a Comment